Govt targets 215 million tobacco output by 2020

Livingstone Marufu
Government expects tobacco output to reach 215 million kilogrammes by 2020, from about 190 million kg this year, with export earnings from the golden leaf projected to grow well over a billion dollars.

Presenting his 2018 National Budget on Thursday Finance and Economic Development Minister Patrick Chinamasa projected tobacco output to grow given current level of Government support.

“We expect the flue cured tobacco output to be around 200 million kilogrammes next year from 190 million kg this year. Again we expect that growth trajectory to increase to 210 million kg in 2019.

“Government expects tobacco farmers to reach 215 million kilogrammes by 2020 and maintain that level for the many years to come,” said Minister Chinamasa.

Zimbabwe is targeting deliveries to exceed 200 million kg next year, with over 100 000 farmers having already registered to grow the high export earnings crop.

According to Tobacco Industry and Marketing Board (TIMB) statistics, the number of farmers who have registered grow tobacco this season represents a 36 percent increase from 73 492 in the previous season.

Tobacco farming used to be a preserve for white commercial farmers, but has fast become a major source of livelihood for many Zimbabwean small-scale and communal farmers.

TIMB statistics show that 25 852 farmers have so far registered to grow tobacco for the first time this year compared to 13 842 last year with the registration still going on.

Highest foreign currency earner

Over the past three to five years, tobacco has been the highest foreign currency earner for Zimbabwe, with earnings last year totalling $933 million by December 31.

Already this year, the country has earned $830 million after selling about 165 million kilogrammes and is projected to rake in about $980 million by end of year.

Meanwhile, analysts estimate tobacco export earnings to top US$1,3 billion by 2020, given level of support by Government to farmers.

The Reserve Bank of Zimbabwe Governor Dr John Mangudya has since called on the tobacco industry to open auction floors earlier to take deliveries and ensure the crop is exported early enough to earn the country foreign the exchange needed to ease the cash shortages being experienced in the country.

The floors usually open in February to cushion farmers from cash shortages.

The closure of the tobacco season has made the country’s foreign currency coffers dry, consequently the country has been loaned US$600 million nostro stabilisation facility to ease cash shortage.

By increasing production the country is expecting to earn more hard currency and reduce the shocks emanating from dry period for cash, which runs from August to February of consecutive years.

Tobacco exports are expected to grow top US$1 billion staring from next year going forward with China among the top destinations for Zimbabwean tobacco, followed by South Africa, Belgium, United Arab Emirates and Indonesia.